Seven Falls project aims for 2010

Published: Thursday, December 24, 2009 at 4:30 a.m.

Last Modified: Wednesday, December 23, 2009 at 10:58 p.m.

Seven Falls Golf and River Club's descent into bankruptcy was a prime example of the real estate and financial challenges in 2009.

As the economy soured in late 2008, lot sales dried up at the 1,500-acre planned golf course community, and the development faced serious financial challenges.

Developer Keith Vinson remained optimistic about the prospects for Seven Falls throughout 2009, even after contractors placed more than $5 million in liens against the property in Etowah. He said he was close to getting new financing in the spring and claimed the Arnold Palmer golf course would be up and running in the fall.

Vinson was prophetic in February when he proclaimed, "Under no circumstances has Seven Falls needed to or will file for bankruptcy."

Real estate was difficult to sell throughout 2009, especially on high-end developments like Seven Falls.

"I think we've all taken a hit," said Brian Ely, developer of Cobblestone Village on Greenville Highway.

Work completely stopped at Seven Falls in the spring. Vinson focused on keeping the project alive and conserving cash. He only maintained the grounds, tried to complete the Golf Academy and realigned Pleasant Grove Church Road.

In June, Vinson expanded his real estate holdings. He took control of another planned community along the Rutherford and McDowell county lines called Queen's Gap. Within weeks after taking control of the project, billboards sprouted up all over Western North Carolina that marketed Seven Falls and Queen's Gap together.

"The seller wanted to spend more time with his family, and we guaranteed the completion of phase I and the golf course. ... We have the funds to complete the golf course, and we feel pretty good," Vinson said in June.

By August, National Bank of South Carolina started foreclosure on two parcels within Seven Falls. The bank claimed the development was behind on loan payments. The loans were valued at $4.04 and $11.7 million and guaranteed by two separate parcels within Seven Falls.

Vinson negotiated several extensions and defiantly showed up to the original sale date.

"I own it," he said. "I will continue to own it. ... It is nothing but a procedural thing, and at the end I will own Seven Falls."

The bank finally foreclosed on the two parcels. National Bank of South Carolina purchased one parcel for $11.2 million and other parcel for $4.1 million Oct. 15.

Seven Falls and a company associated with Seven Falls, Zeus Investments, filed for bankruptcy before the 10-day grace period required to complete the sale. Seven Falls claimed $47.2 million in liabilities and $60.7 million in assets, and Zeus Investments claimed $7.2 million in liabilities and $10 million in assets.

Vinson wants to emerge from Chapter 11 bankruptcy early next year. He hopes to complete financing and finish the golf course in 2010.

"We believe completion of the golf course will draw more buyers to the development," Vinson's attorney, Christine Myatt, told the U.S. Bankruptcy Court Dec. 16.

<p>Seven Falls Golf and River Club's descent into bankruptcy was a prime example of the real estate and financial challenges in 2009.</p><p>As the economy soured in late 2008, lot sales dried up at the 1,500-acre planned golf course community, and the development faced serious financial challenges.</p><p>Developer Keith Vinson remained optimistic about the prospects for Seven Falls throughout 2009, even after contractors placed more than $5 million in liens against the property in Etowah. He said he was close to getting new financing in the spring and claimed the Arnold Palmer golf course would be up and running in the fall.</p><p>Vinson was prophetic in February when he proclaimed, "Under no circumstances has Seven Falls needed to or will file for bankruptcy."</p><p>Real estate was difficult to sell throughout 2009, especially on high-end developments like Seven Falls.</p><p>"I think we've all taken a hit," said Brian Ely, developer of Cobblestone Village on Greenville Highway.</p><p>Work completely stopped at Seven Falls in the spring. Vinson focused on keeping the project alive and conserving cash. He only maintained the grounds, tried to complete the Golf Academy and realigned Pleasant Grove Church Road.</p><p>In June, Vinson expanded his real estate holdings. He took control of another planned community along the Rutherford and McDowell county lines called Queen's Gap. Within weeks after taking control of the project, billboards sprouted up all over Western North Carolina that marketed Seven Falls and Queen's Gap together.</p><p>"The seller wanted to spend more time with his family, and we guaranteed the completion of phase I and the golf course. ... We have the funds to complete the golf course, and we feel pretty good," Vinson said in June.</p><p>By August, National Bank of South Carolina started foreclosure on two parcels within Seven Falls. The bank claimed the development was behind on loan payments. The loans were valued at $4.04 and $11.7 million and guaranteed by two separate parcels within Seven Falls.</p><p>Vinson negotiated several extensions and defiantly showed up to the original sale date.</p><p>"I own it," he said. "I will continue to own it. ... It is nothing but a procedural thing, and at the end I will own Seven Falls."</p><p>The bank finally foreclosed on the two parcels. National Bank of South Carolina purchased one parcel for $11.2 million and other parcel for $4.1 million Oct. 15.</p><p>Seven Falls and a company associated with Seven Falls, Zeus Investments, filed for bankruptcy before the 10-day grace period required to complete the sale. Seven Falls claimed $47.2 million in liabilities and $60.7 million in assets, and Zeus Investments claimed $7.2 million in liabilities and $10 million in assets.</p><p>Vinson wants to emerge from Chapter 11 bankruptcy early next year. He hopes to complete financing and finish the golf course in 2010.</p><p>"We believe completion of the golf course will draw more buyers to the development," Vinson's attorney, Christine Myatt, told the U.S. Bankruptcy Court Dec. 16.</p>